Later On

A blog written for those whose interests more or less match mine.

The ugly tactics Wall Street uses to intimidate and control the press

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Heidi N. Moore, who has been an editor, columnist and reporter for publications including the Guardian U.S. and the Wall Street Journal, writes in the Washington Post:

When Anthony Scaramucci took over as White House communications director, prompting the resignation of press secretary Sean Spicer, the initial reaction from Washington journalists was warily optimistic. Where Spicer was aggressive and hostile, Scaramucci would be “smooth” and affable. He even blew a kiss to end his first press briefing. These looked like signs of a thaw. After all, officials and reporters in Washington may still joke around after a bad story or a slight; the hostility is often for show. Politics is communal and built on co-dependency.

Finance is different. It is individualist and zero-sum. As a reporter and editor covering Wall Street for 18 years, I studied the industry’s aggressive approach toward the press: Financiers, and the multibillion-dollar companies they work for, are friendly and charming as long as you see things their way, and they do everything they can to win reporters over. But when reporters don’t buy their line, the Wall Street answer is to get intransigent journalists removed from stories.

Scaramucci’s vulgar phone call to the New Yorker this past week was far more typical than his genteel first briefing was. If the Trump administration’s approach to the media was alarming before, importing the attitudes and practices Scaramucci learned in New York will only make things worse.

Scaramucci, who ran a relatively modest firm in the enormous world of hedge funds, has proved himself adept at this style. President Trump reportedly liked that Scaramucci’s pushback about an inaccurate CNN story — complete with rumored threat of legal action — led to the departures of three veteran investigative journalists. Scaramucci pointedly called on a CNN reporter at his first briefing and a few days later said, on a hot microphone, that network boss Jeff Zucker “helped me get the job by hitting those guys,” referring to the unemployed reporters. To Trump, the fact that Scaramucci kneecapped three journalists in one swoop surely made him the kind of press guy he was looking for: effective in eliminating enemies.

There’s every reason to believe that the White House team sees this as a model: It will not worry about the accuracy of what is published, only whether the tone is Trump-friendly. Of his new job, Scaramucci says, “It is a client service business, and [Trump] is my client.” Wall Street’s methods of fighting negative coverage are more extensive, brutal and personal than Washington’s. The reigning philosophy is: “I can win only if you lose.”

As a reporter at the Wall Street Journal during the financial crisis, I was boggled by the lengths to which hedge funds and banks would go to kill a story.

When a negative report was in the works, company representatives often called up the journalist writing it and tried to ingratiate themselves with a charming introduction and some light chitchat. The point was to humanize the people at the firm so that journalists would feel guilty reporting negatively about it. (This almost never worked.) Maybe they’d invite the journalist to an outing — a bank-sponsored tennis game, a classical music concert — or a party held by the firm to get the journalist “in the fold.” When a piece was in process, they’d follow up daily, trying to get a sense of who the journalist’s sources were and the direction of the story. The key at this point was to keep their enemies close.

For example, when I was reporting on an executive coup at Morgan Stanley, the bank’s representatives were in touch with me more often than I spoke to my own mother. “Why would your publication waste time on a story like this?” they’d ask. “It’s all going to blow over.”

My favorite of their techniques, used by two major investment houses, was to flatly deny a story that I knew was accurate. When I offered to call my sources to reconfirm, the response I received was: “That’s it? That’s your negotiation?” As a journalist, I didn’t see the truth as subject to negotiation. But Wall Street did; it’s all about what you can get.

When charm didn’t work, I saw or heard about firms wheedling, pleading, threatening, calling editors and even contacting media executives. Insults and obscenities were common. One troubled hedge fund’s foul-mouthed manager called me every day for a week with some new litany of abuse.

Other companies tried to co-opt aggressive reporters by offering them lucrative jobs (financial journalists cannot report on companies to which they have ties, including potential job offers — at the Wall Street Journal, we weren’t even allowed to be friends on Facebook with PR people). As I was reporting one critical story about a hedge fund, it had a friendly PR firm dangle opportunities in front of me. I had no interest, but I told my editor and handed the story to another reporter nonetheless. Some journalists took those jobs, working for companies they once covered. That’s the kind of trap that former Wall Street Journal reporter Jay Solomon apparently fell into; he was fired last month for allegedly trying to broker arms deals between his sources to strengthen the relationships.

Another company, alarmed at my front-page story about the impending failure of a multibillion-dollar merger,  . . .

Continue reading.

Written by LeisureGuy

30 July 2017 at 8:27 am

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